Commercial Loans Blog

What is the difference between a residential and commercial investment property? You will need to know this because this will determine who you will approach to do your investment property mortgage. A commercial lender provides financing for multifamily of 5 units or more, and other properties like office buildings, mixed use buildings etc. and is typically zoned commercial. While a residential lender specializing in investment property loans finances a property that has 5 units or less. Because of the differences in the purposes of these two loans, you will also notice their structures also differs. Basic areas of difference include these:
• Loan size--Commercial loans tend to be larger since commercial properties are typically more expensive than personal residences.

• Credit requirements--Typically, a commercial investment property must show the ability to cash flow, have a good occupancy rate and good credit is used to determine eligibility. A residential loan requires good PERSONAL credit and income.

• Terms--Commercial loans typically have a 5 to 10 year terms and amortized over a 20 year period.
Wishing You the Best,
Karen Schimpf
Toll: 866-400-8630
Phone: 512-650-8630
www.BizLoansConnections.com
Posted by Karen Schimpf on December 1st, 2010 7:52 AMPost a Comment (0)
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